The largest hub for circumventing sanctions in the Emirates has been hit by the US and EU sanctions
Activities of Russian banks in the UAE are in the US crosshairs
Western countries are increasing pressure on the hub for circumventing sanctions against Russia that emerged in the United Arab Emirates in the second half of 2022.
Source. This was reported by The Moscow Times.
Details. After a series of warnings voiced by US officials during their visits to Abu Dhabi, the United States and Britain began to impose sanctions on Russian banks that open branches in Dubai.
As part of a package of measures to mark the anniversary of Russia's invasion of Ukraine, the British and American Treasury Ministries blacklisted MTS Bank, a 100% owned telecommunications operator controlled by billionaire Vladimir Yevtushenkov's Sistema Financial Corporation.
The bank, which is one of the top 40 banks in Russia by assets and retains access to the SWIFT system, has been subject to blocking sanctions that prohibit any transactions with it. This means a de facto ban on payments in US dollars and British pounds.
The sanctions against MTS Bank were imposed four months after it opened a branch in Dubai and received a work permit from the local regulator. The activities of Russian banks in the UAE have come under the US crosshairs. In late January, the White House sent a delegation to Abu Dhabi led by Deputy Treasury Secretary Brian Nelson.
As the supervisor of financial intelligence, Nelson warned UAE officials of their readiness to impose sanctions on companies and individuals who help circumvent measures against Russia.
Over the year, the number of Russian companies opening representative offices in the Emirates has increased sevenfold, with more than 700 firms opening in the country since the beginning of this year. According to Fortune, about 30% of the richest Russian citizens have moved to the Emirates with their money.
Kazan's Ak Bars Bank may be next in line, having dramatically increased the share of foreign exchange transactions in UAE dirhams.
Background. As a reminder, the EU has adopted the tenth package of sanctions. To learn more about what it includes, follow the link.
